NIIT shares up 20% after sale of US training unit

MUMBAI: Shares of IT training company NIIT skyrocketed by nearly 20 per cent on the bourses today after the company said it sold its US-based subsidiary, Element K Corporation, to SkillSoft Corporation for USD 110 million in an all-cash deal.

The stock, which opened the day on a robust note, jumped further by 19.95 per cent to hit the upper circuit limit at Rs 52.30 on the BSE.

On the NSE, the stock shot up by 20 per cent to a high of Rs 52.50.

However, within minutes, the stock pared some of the initial gains and was trading at Rs 50 on the BSE, up 14.68 per cent, and at Rs 49.85 on the NSE, up 13.94 per cent, at 1151 hours.

NIIT acquired the 700-employee strong Element K for USD 35 million in 2006.

The company has also entered into long-term services and licencing agreements with SkillSoft to work together for producing new content for SkillSoft's e-learning content collections for business, IT and desktop skills.

The funds from the deal would be used to strengthen NIIT's four platforms -- managed training services (MTS), cloud campus, its private school venture (NGuru) and university programme (YuvaJyoti).

The surge in the stock was in sharp contrast to the sluggish broader market, with the BSE benchmark Sensex trading lower by 90.19 points at 16,992.50 at 1151 hours.

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